Where Is the Urban Mobility Revolution Headed?

Where is the city mobility revolution headed? And what’s the future of the car (at a moment when some are predicting its extinction)? What new technology innovations will change the way cities are planned while altering the many ways city-dwellers travel within and between cities? How close are we to realizing ‘personal mobility’ visions that have been imagined for decades? What shifts in regulation, investment and policy need to occur in order to mainstream the next generation of advanced technology?

Media coverage of panel

Transcript

Introduction by Gordon Feller

This session is Where is the Urban Mobility Revolution Headed? Bill Reinert, come up with your panel. Let me introduce you to Bill Reinert. If you don’t know him, he’s the man responsible for getting us those vehicles downstairs. When you see that eye candy, you can ask Bill and his colleagues what you’re looking at which is going to be a pretty amazing show for us. Bill and I in 2006 when we found ourselves landing in New Delhi, India courtesy of Time Magazine and CNN, we spent enough time thinking through and asking the question “What are the gaps and non-gaps, the leadership gaps, the other big gaps that city leaders like those we had a moment ago face?” One of those that they face is seeing the urban mobility revolution with crystal clear lenses. We thought it would be a good idea to bring the innovators here with you today to hear about real innovations in the real world of transportation and mobility. Bill, please introduce our speakers.

Bill Reinert

Thanks everybody for coming here. I think you’re going to find out that we’ve got some of the world’s leading transportation experts here. I’ve known all these people for about 10 years. Dr. Susan Shaheen who is Co-Director of the Institute for Transportation Studies, I’ve got Eric Cahill here who is the Founder and a Director of Adaptiv Consulting, Sue Zielinski who does so many things that are amazing in integrating transportation modes across the globe, and Dr. Samuelsen who I’ve worked with for a long time. He runs ZEVNET. I believe it’s the longest-running last mile transportation car-sharing program in the world.

The 1990s was very busy for Toyota. We were busy developing the Prius and we developed the little car called the ecom. We saw a long time ago, they grow out of cars. The cars don’t fit, as you heard from the Deputy Mayor of Amsterdam. Cars don’t fit in the existing infrastructure. So we started looking at what we could do. We developed a little two-seat electric car called the ecom. We developed some telematics around it. This was in 1996 so we didn’t have the iPhone applications and things like that to make it work. But Toyota took a chance; so did Nissan. We worked in Kyoto and Irvine. We started that process. That process has gone and continued to this day.

Now we’re looking directly at car-sharing and peer-to-peer car-sharing. The little cars you’ll see downstairs, one is a Toyota. We developed that specifically to experiment with. You’ll see it in experiments all around the United States to look at how people can do car-sharing, how to do peer-to-peer. We’ll also do experiments in Japan and in Europe. The other car that I’d like all of you to look at is a THINK. The company is no longer in business but it was designed as an urban car. It has aspects that are quite a bit different than the Toyota car. It’s interesting.

What I’d like to do now is get started. We don’t have much time and we’ve got some really good people here. I’m going to take a seat here and get on my iPad. I’ve got a question for Dr. Shaheen. What are the major trends in mobility are you seeing emerge? Are these going to be locally realized? Are they nationally defined or globally defined? How can we the pieces back and forth to get economy of scale?

Susan Shaheen

Thanks, Bill. Before I even start with that, I want to thank you and Gordon Feller for getting the Meeting of the Minds started. I participated in the first one in Oakland, California. I would say it’s grown tremendously and it’s a wonderful thing to see.

To get to Bill’s question about mobility trends, one of the things that we’ve been involved in UC-Berkeley for quite some time −close to almost 2 decades now− is looking at the concept of shared-use mobility. This trend is really starting to take hold worldwide. We’re seeing tremendous developments and phenomenon like public bike sharing. We’re seeing this concept take hold and go from city to city to city. In North America, we’ve seen it grow to over 20 IT-based systems and over 200 programs worldwide. These systems do not seem to be doing anything but taking off and growing. Some of them are so big that they have 70,000 bikes in them. That’s the Wuhan system in China just to give you a sense. The Velib system in Paris is around 20,000 bikes. Many of you may have heard the New York City is planning in the spring of 2013 to launch its program with approximately 10,000 bikes as its end-state goal. That just gives you a sense that there are some global trends going on here. The scale does differ based on the nations that are pursuing it and the cities that are pursuing it. China’s government has really gotten into bike sharing. It is the kingdom of the bicycle. It’s not surprising to see that when they go to public bike sharing, it’s on a really massive scale.

In terms of car sharing, it got started in 1948 in Switzerland and really started to take off in Europe in mid- to late-1980s. In North America, it got started in 1994 in Canada and Portland, Oregon in 1998. We now have 44 programs here. We are collecting the numbers from members and I will report we really close to the million-member mark in North America, which is, I think, a pretty significant milestone for us. In October 2010, we reported that there were about 1.25 million people worldwide car sharing. You can see that once I get those numbers in for October 2012 −I collect the numbers every two years− it’s going to be well over 1.5 million or greater, I anticipate. Things are really, really changing. They do have different flavors regionally and locally. I think that’s a tremendous thing.

Another thing that Bill mentioned is the peer-to-peer car sharing concept. This is the idea where you can put your personal vehicle to a car sharing fleet. Some people are really nervous about a car sharing concept. I’m excited about it because it’s an opportunity to expand the size of the car-sharing network virtually overnight. There are opportunities and there are obstacles that have to be addressed but this is an opportunity to go even outside of dense urban areas where public bike sharing or car sharing tend to be the most popular concepts. With peer-to-peer car sharing, there’s the potential to go to many other areas, including rural areas. There’s great potential. In terms of P2P as of April 2012, there were 33 programs worldwide and about 10 of them are here in North America. Some of the countries that seem to be taking off the best are European countries. It has something to do with culture and litigious nature. Perhaps in North America, we’re a bit more litigious. We have to be a little bit more concerned about insurance issues and there may be more issues of trust to address.

Overall, I think there are global trends, Bill. I do think that each of these concepts has the ability to shape and reflect cultures in the local areas where they’re being deployed.

Bill Reinert

Thank you so much. Next gentleman over here is Eric Cahill. I met him several years ago. We worked together on the future transportation fuel study from the Department of Energy reporting to Steve Chu. That study took about 400 people. It lasted for really the best part of 3 miserable years. We just finished it. We looked at future transportation fuels out to 2050. Eric helped me greatly on the electric subgroup and he also helped with new business models. Before being at Adaptiv, he helped developed the powertrain for Fisker Karma and did the X-PRIZE for automobiles. He’s very, very interested in disruptive technologies so I’m going to punish him with the disruptive technology question.

Eric, when we think about the future of the automobile 20 to 30 years from now, even 10 years from now or even sooner, what are the areas that you think are ripe to see disruptive technology?

Eric Cahill

Thank you, Bill. I appreciate the invitation here and I appreciate the question. I’m happy to take the challenge of disruptive innovation. I know that phrase is thrown about quite a bit. One of the key takeaways that I got from the participation in that future transportation fuel study is that within our existing paradigm, within the dealer sales model that we live and all love today, we are not going to see anything that looks like disruption over the next several decades. We might see some penetration. Some of the optimistic scenarios are 30% to 40% penetration for electric vehicles and other alternatives by 2050. We all know that that’s not going to do it for us.

So there is increasing attention to concept of innovation processes. What is it going to take to transform industry? What’s it going to take to transform the markets, to raise these technologies? I think some of the things that were discussed in the earlier panel spoke to that. We’re seeing innovation at all levels. I think there are a few things that are fundamentally different today because we’ve tried things in the past. Bill mentioned a couple of technologies that were tried in the past. One of my colleagues Dan Sperling at the Institute of Transportation Studies at UC-Davis likes to call it the fuel du jour scenario where every decade we have the solution, the magic, the silver bullet that’s going to solve it for all of us, whether it’s the hydrogen fuel cell car or electric vehicle or natural gas car or whatever.

But the bottom line here is that it’s not just about the technology, first of all. Secondly, it’s not 1990. It’s not 2000. We’re in 2012 and a lot has changed, number one being connectivity. That’s a key theme of this conference. Ubiquitous connectivity which is something that we’re approaching within the next decade or two is something that can fundamentally revolutionize how we know the automobile today. I think that’s going to come in the form of much more choice for consumers. This is going to be achieved through new business models that are unlocked by many of these technologies that didn’t exist before. Some of these business models we’re already seeing in action today. These are some key signs that disruption is a possibility. It’s already underway. There are ripples that are just now being dropped in the pond. These could grow into tidal waves ultimately.

One place that’s ripe for this certainly is in emerging markets and in dense mega-cities where you’ve got not only technology, you’ve got opportunity, you’ve got the will of many governments with far more authority than we do in the US to accelerate change. Frankly, I’m very hopeful that we’re going to see a wide variety of cars that take advantage of various alternate fuel technologies, including electrification connectivity. This is going to unleash expanded functionality for many of us in terms of what a car is and what it can do for us. Ultimately, it’s going to be done at a cheaper price and it’s going to grow multiple markets so that it will expand the pie for everybody.

Bottom line, what I’m optimistic about is we’re going to see a lot more choice at a lower cost. We’re going to have a better experience traveling at a lower cost. Thank you.

Bill Reinert

Thanks, Eric. Next to Eric is Sue Zielinski. She’s from SMART out of the University of Michigan. She sent me a thing about her passions and I just have to read it because it’s so cool. She’s passionate about moving money, understanding and mobilizing across mobility and industrial markets, crowdsourcing, understanding, connecting and supporting global network of new mobility entrepreneurs and enterprises, new business models and innovations that conserve the urban poor. I’m very, very interested in that. It’s great for us to sit here wealthy enough to travel here but if you’re struggling to get by day-by-day, how do you get into sustainable mobility there? Susan actually is on the ground doing that. Connecting the dots, engaging the stakeholders and moving minds and moving policy – some of the stuff she does is amazing. Susan has living laboratories around the world where she dedicates her time.

For you who don’t know, I’m just going to ask Susan. I know you’ve been tremendously busy with the living laboratories. Can you tell us what you’re doing there and how it’s working?

Susan Zielinski

Actually, the living laboratories are like tech transfer, in a way. By the way, before I even start, I wanted to echo Susan’s comment and appreciation of Meeting of the Minds. I was looking out and though I can’t see you now, what I know is many of you are now friends, colleagues and partners in some of these living lab projects and some other projects we do because of Meeting of the Minds. Really, that’s the wave of the future.

In terms of the living labs and why we do it, in University of Michigan being a university, you’d think we’d start with research. What we wanted to do was say, “OK, we know that we need to be shifting from this 20th century, heavy infrastructure, single-mode approach, squeaking cars, alternative fuels – all of which is good. But we’re moving from that into a lighter, more dynamic, nimble, systems approach, linking all the modes, all the services, all the technologies and the various designs and infrastructures. Friedman might say transportation is flat. We’re working into this new mobility grid where what you have is an integrated system that serves all users. You can move seamlessly from one mode to the other. IT has really supported that. We know that’s the case but one of the things that happens when we visit these different regions when we work together is actually how do we do that. You can’t start with one thing when you’re trying to do a system. You have to build a hologram and have that create demand and work outwards.

So we began by bringing together the stakeholders who were key and the first thing we learned was that that’s really rare, that the stakeholders across the different kinds of segments like the technologies, the services, the designs don’t really talk to each other. It’s not because they don’t want to; it’s just they’re focused on that one thing. So when we bring these people together, we actually map the inventory of what’s already connected. What is the mobility grid that exists in that region or in that particular community? You can do this on a really small scale or a region-wide scale. When you do that, you say, “How do we implement this?” What happens when you start to take that inventory, when you start to think about it as a new mobility grid, it’s linking the shared services. It’s linking the bicycles, the transit, the electric vehicle plug-in stations, the airports, the boats. When you begin to see it this way, we begin to start these partnerships across the sectors. The big businesses are starting to rethink themselves, for example, Ford rethinking itself as a mobility company, like Cisco and IBM working on ways to make these connections from a transportation point-of-view, like small entrepreneurs and startups and VCs that are working on these solutions from apps, traffic management, integrated fare payment, integrated way-finding, all to way to local services that connect the dots and link that can move between the public systems and the private systems.

So what we try and do is accelerate the process of implementing these systems. The first step is to understand that. The second step is to map what’s there. The third step is to build on what’s there and identify the systems that are most efficient and optimize so that you won’t have things where you have a bus rapid system that’s running on top of a subway system, for example. You’re not duplicating efforts. It’s extremely cost-effective. It’s something where those regions and those businesses are spending the money already on the projects that they’re doing. It’s a real leverage and optimization similar to Meeting of the Minds but from a very much systems point-of-view.

The second thing that we do in regard to that is what are the economic benefits and opportunities. Beyond the regional competitiveness, beyond some of the job creation and cost savings that you get from such a systems approach, you also have this emerging Silicon Valley of new mobility. Back in 2002 in Toronto, we did a study on the emerging industry. It was really at the back of the envelope. Wow, there is really an industry here, just as you had mentioned. Now, it’s completely showing itself worldwide. What regions can do from a very customized point-of-view is identify what is their particular industry cluster. In the industry cluster, so much beyond manufacturing, energy and utilities, it moves into IT, real estate, tourism and a whole range of different industries that form a cluster. We’re beginning to build platforms for doing the process of piloting integrated systems. We’re also trying to build platforms for economic mapping, identifying the economic opportunities region by region digitally.

The last thing that we’re doing in these living labs −and different things in different places because it has to be customized to those needs− is to think about moving minds. How do people make decisions? Why do really people move? It’s not simply to go from A to B. Their sole motivation is not the price of the trip. It’s very much about status. It’s very much about beauty, convenience, and all those things of a city. So we look at how people make decisions. How do we also begin to think not how do you choose between a bus versus a car, or a bicycle versus a car but how do you choose between just a car or a bus versus a whole portfolio of options that are seamlessly connected? How do you decide about taking on this system? What are the factors that are important? How do we as developers of these build these systems that support all of those needs? How do we market them and talk about them? I think about that as moving minds.

So we’ve become this process. We started this at the same time as Meeting of the Minds started. Actually, it was a year after we started in 2007 working in India in 3 different cities. Then moved to South Africa, Brazil, the Philippines, the US and now, we’re starting to work in China. We do different things in different places according to what they need to do. But in all cases, we bring together a range of players. We always try to map out what’s already there first and build on what’s there.

Has anyone here been in a frustrating transportation-related meeting? My experience has been in transportation, we really like to talk about what’s not working. It’s basically a 2-hour meeting. For an hour and 45, you’ll have talked about all the things that are terrible. In the last 15, you go, “Oh no, we were supposed to come up with solutions.” A laundry list comes out. Someone puts up their hand and says “Voice of reason: we have to prioritize.” Prioritizing is not the name of the game here. If you’re looking at a system, what you want to see is how all the stuff works together. It’s as if God were to say to you, “Do you want a heart, a lung or a pituitary gland?” You’d say, “I kind of want all of them and I want them to work together.”

Really, what we’re trying to do is let’s look at what we’re proud of, what’s really great, what’s really working. Build on that. Identify the small things that can happen like “Oh, I never knew so many zip cars were so close to all my bus stops.” The head of the transport of Washington, DC said that. “We could just move those over or we could just shift the bus stop.” These are tiny little things that make a huge difference for the user. Also, comprehensive things where you can have a whole cloud traffic management system that can integrate all of these things. You can have a whole corridor of transportation or transit system that can support a whole number of different needs.

That’s just a quick snapshot of what we do in those living labs and where we do them. I think I ran way out of time.

Bill Reinert

Thank you, Susan. Next is Dr. Scott Samuelsen. Scott and I have been friends for 2 decades now. His bio does not do him justice. I will tell you something that’s not in his bio. He just recently developed, invented, had the foresight and the ability to engage a high temperature fuel cell with a wastewater treatment plant. So what he does now is what’s called tri-generation. He generates electricity from the sewage digestive gas that normally would be burnt or just go up in the air. He also recovers the heat for processing the sewage digestive gas. It has a slipstream of hydrogen so it’s really zero carbon hydrogen. It’s not a dream. This really works. We got hydrogen stations up and down 405 in California primarily because of Dr. Samuelsen’s work on the street model for hydrogen infrastructure. He is key in that. Because of that, southern California will be the launch pad for the hydrogen fuel cell cars coming up from almost every manufacture in 2015.

But Scott also a long time ago envisioned and created ZEVNET. I’m going to get correct I’m sure but I believe it’s the longest continuously running last mile station car program. We’ve had our ups and downs in getting it working. It’s still working. Scott, can you tell us about ZEVNET? How did you start it? Why does it work? Why has it lasted so long?

Scott Samuelsen

I’ll do fine on the first two questions; I’m not sure about the last one. ZEVNET was established in 2002, 10 years ago. ZEV stands for zero emission vehicles. The vehicles are BEV battery-electric vehicles provided by Toyota, so the RAV-4. In the early days of ZEVNET, we also had the ecom that Bill alluded to in his introductory remarks. The prototype city electric vehicle that was very, very popular during its 3 years that it was with us. The NET in ZEVNET stands for network-enabled transport. The partner there is Zip Car who 10 years ago agreed to partner with us and provide the web-based reservation system and the hardware that we still use today although fortunately and not surprisingly, it’s evolved in sophistication over the years. The anchor location for ZEVNET is the Irvine Transportation Center, Irvine being about halfway between Los Angeles and San Diego. It’s a multi-modal center transportation. Even though Irvine is the one of the largest planned communities in the United States and has very open roads for travel, there is a requirement for those doing business in Irvine to reduce the miles driven by any one employee. So the modal center has a number of activities. Of course, the buses and the taxis do meet the commuter train being operated by Amtrak and Metrolane but there’s also an entity called Spectrumotion that works with the companies in order to provide transportation alternatives. That’s where ZEVNET is located. It’s a very prime real estate right against the tracks where people and commuters getting off and on the train can actually see the ZEVNET option.

The option is built on a model with corporations or corporation-subscribed. Their employees arrive in Irvine in the morning having reserved a vehicle. Then along with other employees that have joined with them travel to their place of employment. At the place of employment during the day, fellow employees who are not part of the station commute are able to access the vehicle for personal or business use. At the end of the day, the vehicles reserved return to the station. At that time, we happen to have commuters who are leaving Irvine early in the morning and returning at night. They’re able to pick up their vehicle, get to their home, and then bring it back the next morning, like a 24/7 use of the vehicle with very little time sitting in place to be charged.

The program is not a business-based program although we look at the business aspects of it. It’s a research program and over 10 years, it has provided us a gift of remarkable information, particularly at times when it is needed. Even though we thought at times we’d not be able to continue the program, it’s still ongoing. The rich dataset includes telemetry that we’ve been able to equip the remaining RAV-4s with, as well as a GPS capability that is, of course, always fascinating and allows us to track the vehicle’s use every moment, every day, every week.

A particular interest to us now in this age is the charging behavior of the drivers. That data is being used today for informing the State on electric charging infrastructure. So overall, it is a very successful and rich program with interest always growing if we only had more vehicles, had a correct policy, and had an investment in the interest. Growing demand for this is there.

Let me just conclude by mentioning that we have another paradigm shift occurring in this area with the car-share companies. The particular example that I want to share is Zip Car where they have deployed their vehicles on university campuses. We have that at UC-I so we’re able to actually watch the engagement of the students in having this option of a car −I think $7 an hour− that they can have access to and not bring their car onto campus. We’re creating through that not only a successful business model −thanks to Zip Car− but also training or allowing a young generation to learn about this option that they find extremely attractive. It’s an ignition point or callus point that I don’t think we should ignore that is occurring right now in terms of trends that are evolving in this area of shared car use. Thank you.

Question & Answer

Bill Reinert: Thank you. I have a couple of follow-up questions for everybody just because I want to be cruel. Susan, you mentioned a variety of multi-modal sharing. It’s always interesting because we face this giant budget deficit in the state of California, in the United States and, in fact, throughout the world. What is the role of government funding in here? Do these programs mostly have exit strategies where they’ll get away from funding like the bike-share programs and that they’ll be for-profit? If so, how so?

Susan Shaheen: Great question. On the business model side, many of these types of concepts start out with governmental funding to get them their capital funds, to get some of the cars out there, the bikes out there and then a lot of work has to happen to try to figure out how do we make this a sustainable business model. What we’re seeing with public bike-sharing is, I’ll start with that first, in Europe where this got started and we all knew about Velib and the expansion over in Europe, that model is much more of what we would call an advertising model. So partnerships with companies like JCDecaux and Clear Channel where in exchange for having an opportunity to advertise on street furniture in an urban area, they also provide a car-sharing service. What’s really interesting, Bill, is in North America we tried that. It didn’t work so well. What’s happening for us is more of a sponsorship model. What’s interesting here is in New York City −I think this is a really notable example that we should talk about− is over $40 million was given by one title sponsor to provide the capital. New York City has come out and said they will not take a dime of public funding. They’re going to figure out how to make this work with a sponsorship model. I think the business models are really changing. The other thing, too, Bill that I’m sure you’re really aware of is there’s all of these one-way car-sharing services that are starting to pop that the automakers are bringing onboard. Daimler has brought Car2Go. It’s expanding across the world, particularly Europe and North America. They made a multimillion-dollar investment in this system. BMW is doing it with DriveNow. So we see these for-profit generated models. In car-sharing, we see both for-profit and non-profit models. At this point, most of the traditional car-sharing services including peer-to-peer are not receiving much government support at all. I’d actually like to see more policy support as Scott mentioned for all of these options because I do think that while some of the numbers that I’ve given are really impressive, I’d like to see them a lot bigger.

Bill Reinert: Thanks. Eric, you mentioned those new and emerging business models you see in the future. Very few of those have anything to do with the tent sale that you guys are all familiar with when we start selling cars. Our model −Toyota’s model and all the car companies’ model− is built on us owning the customer. You come and see us once and we own you. If we treat you right, you come back in 5 to 6 years. The new models are not like that at all, especially when it has electrification. You plug in your car. Now, all of a sudden, you’re the electric company’s customer. There’s an incredible amount of telematics going in cars so you might be chatting with Google or some other space. Eric, who owns the customer in the future? Who is the customer in the future and what is the value of the automaker’s brand then?

Eric Cahill: Also a great question. Who owns the customer in the future? Honestly, with the way I see this happening is you mentioned about the tent sale. The tent sale is all about moving metal and selling as many vehicles as possible. What I see changing is moving from a product-centric sales mode to a more service-based experience or solutions mode or some hybrid in between. So if you think of one end of the spectrum, you’ve got car manufacturers and dealers which are purely product-centric. On the other side of the spectrum, you’ve got full-service providers. These would be car services like taxis, for example. Something in between can come a lot of things like car-sharing and variants of car sharing, whether that’s the traditional car-sharing model that the Zip Car originally introduced which is the round trip, or other some of the more prevalent models today that we’re starting to see like Car2Go and the BMW DriveNow models.

What’s interesting about this is you’re seeing these firms that have been focused primarily in selling vehicles and moving metal put a marker in these spaces and really get out and perform trial-and-error because trust me when I say they went into this not knowing a lot. That’s highly risky; it’s a highly uncertain market. The thing is they’ve got the resources to do it. It literally just takes the leadership to do it. In the case of these companies, the leadership understands that things are changing. Customer preferences are changing that’s being shaped by technological evolution in terms of people’s experience with connectivity and their expectations for what is possible in transportation. Consequently, their expectations are changing. That means if you want to continue to play in the customer’s ballpark here, you’ve got to be better than your competition basically. You’ve got to come up with new ways to wow. Doing that within the existing business model is going to be tough. It certainly is a tough sell in the United States even with the introduction of telematics, nav systems and all the whiz bang stuff. Fundamentally, that is not what I would call anything that’s going to be disruptive or transformative. What is going to be transformative, I think, is when we start to move towards a service model and manufacturers actually start to cater to those models. That would allow a much broader choice of vehicles, vehicle footprints, form factors and capabilities. Instead of seeing, for example, the car that meets every person and purpose, we’re actually going to see specific, mission-dedicated type of vehicles that do something very well and serve a certain market segment but it’s profitable to do so, instead of having them make a car that does everything for everybody and has to sell in large, large volumes in order to recoup the capital expenditures. That’s what I see ultimately happening.

Bill Reinert: I want to reserve a little bit of time for some questions from the audience but I do have a question for everybody. What shifts in regulation, investment and policy need to occur to take what we’re discussing from laboratories into the living rooms? How in the hell do we do it? Let’s start with Dr. Samuelsen down there.

Scott Samuelsen: There are some disruptive aspects that we are currently beginning to experience that need to be addressed not only in the laboratory in the university but also in the field laboratory in the practical community. What I mean by that is, of course, the electric vehicle where we have now the evolution of the electric drivetrain in vehicles whether it’s a battery electric vehicle, a plug-in electric vehicle be, or a gasoline hybrid vehicle, even the evolution of the hydrogen fuel cell vehicle. It’s important to recognize that transportation is becoming electrically-centric.

Along with that is another disruptive technology which is the push for a greater penetration of renewable solar and wind on our grids throughout the world. These mandates which are often called renewable portfolio standards are such that we’re being pushed into that area in a time when we’re not prepared for it from a grid operation point-of-view. So this penetration is a “nuisance” to the grid. We’re just now starting to look at how to address that. The plug-in vehicles are also a “nuisance” to the grid but unlike the renewable solar and wind, they also can be an asset to the grid. That needs to be researched and actually help manage and mitigate the nuisance of the renewable solar and wind. I think you know what I’m speaking about here. One is the allowance of charging, what can you charge, are you allowed to charge, if you do at a certain time, are you charged more, and the use of the vehicle as a resource for energy storage. That requires the IT but that’s developing very nicely. It also requires unfortunately, a smart grid. That’s evolving but slowly. So the Department of Energy does have a very large project that’s been deployed in Irvine called the Irvine Smart Grid Demonstration Project which is actually a field laboratory in the community to not only explore the smart grid features for the grid itself such as smart gridding, managing of VAR, frequency, voltage and so on, but how to manage the plug-in vehicle. Of course, it will be managed through communication with the grid when it’s plugged in. That’s a fascinating but critically important part of the future that needs to be researched in response to your question, Bill.

Let me also conclude by saying we have an interesting evolution of maybe not disruptive but certainly a paradigm shift in the vehicle where we have the electric vehicle with battery, the BEV. Then we have this other vehicle with a battery but has a longer range today with gasoline BHEV, the future of the fuel cell vehicle. But with hydrogen onboard in addition to the battery, it’s also for storage. So this combination of the fuel that powers the vehicle versus the storage of the energy to not only power the vehicle but have other services is a part of the evolving future that is rich for research as well.

Bill Reinert: Thank you. Can we take some questions? We’ve got some world-class experts up here. Fire away. The harder the question, extra credit OK?

Questioner #1: John Addison, Clean Fleet Report. A lot of discussion of new car-sharing models, point-to-point electric cars, of course, here in California Car2Go. In San Francisco, they are electric. What are the added challenges in the charging, getting vehicles back to where they need to be? Where do you see that taking car-sharing?

Questioner #2: My name is Greg Delano with the Urban Innovation Exchange. First of all, I want to say I’m really glad that you started talking about the smart grid. I think that’s a critical part of what we’re dealing with. I was wondering if you all have already seen or anticipate in the form of actual, physical urban design phenomena changes that are going on in reaction to new sorts of mobility in the city, either something you’re already seeing or things that you anticipate in urban design.

Gordon Feller: One more question from Washington Post, Neal Peirce. I saw his hand back here, a modest man with a big hand.

Questioner #3: Thank you, Gordon. We heard some mention of specialized markets but when I think about automobiles, I think about advertising and I think about the hundreds of billions of dollars a year that go into advertising of standardized models of cars floating over mountaintops and through spotless mountain valleys with no other car in sight. That’s against the expectation of a growing billion-member new middle class McKinsey is projecting for the next couple of decades. It seems to me that could swamp in terms of numbers the alternative and interesting types of new uses that you all are outlining. The question is how does one break that habit of the automobile industry to appeal to people who are newly middle class or established middle class where you get your status through the size of your own personal car.

Bill Reinert: Well, it looks like we’re out of time. I’ll answer your clean fuel scene. The electric car involved in car sharing is very, very difficult. We work with a lot of the car-sharing companies to understand that. You’ve got to keep that car moving; that’s one aspect. The other aspect is when you have existing infrastructure out there, frequently −unless there’s an attendant there− the copper cables will get harvested. They harvest copper from street lights so how do you protect that? One of the companies that is here that is working on that is QualComm. They’re working on inductive chargers. The inductive chargers are game changers because when you have conductive charger, you believe that you’re going to transmit your communication via power line carrier. With inductive, now you’re going wireless and that just opens the door up to just a giant array of telecommunications opportunities.

Eric Cahill: Bill, if I may, another development that I believe we’ll start to see is autonomously-driven vehicles. This is something that we probably won’t see or many people will dismiss out-of-hand when they’re talking about their personal vehicle. But if there is to be an initial market, I think car-sharing is an ideal one where you can employ electric vehicles and they can remotely relocate themselves at a charger or a denser area where they have a higher probability of being picked up.

Susan Shaheen: Can I just add very quickly on the autonomous vehicle front? I do think the big forefront for shared-use mobility is not just the young kids −yes, there are transformational things occurring with the young folks− but we’re working on a project that looks at how we can use autonomous vehicles to help aging baby boomers, actually creating bookends on the generations.

To address the gentleman’s question over here, I would say that yeah, we’ve got an issue with shared use. How do we expand it from early generations to people over 25 to 35 years old? I think we have to start to create a shared-use model that allows people to go through different lifestyle phases. We’ve actually been working on that and have been writing about these types of models that can fill in the gaps and perhaps, be more appealing. Peer-to-peer is one model. Another is fractional ownership, which I’d be happy to talk to any of you about in greater detail.

Bill Reinert: Susan in the emerging market – you’ve probably done more work there than most of us.

Susan Zielinski: I was actually going to say a different thing but I’ll try to incorporate that in one sentence. I wanted to address Neal’s question because I think that we can predict, given the major shift in transportation, that we’re going to begin to see ads from the car companies that are going to show how unbelievably sexy the integrated door-to-door, digitally enabled transportation system is going to be – the new mobility grid. You’re going to see people moving seamlessly from their amazing car that they may have shared with someone, or they’ll just leave it off and jump onto their bike. That is already beginning to happen but the sexiness factor is going to grow and with that, the budget that goes along with it.

Eric Cahill: If not the car company, then some mobility service provider who will gladly do the same.

Gordon Feller: The last word at the end of the panel.

Scott Samuelsen: Oh, thank you. I just saw the timer go to zero. On the urban planning aspect of the question, there is certainly not a solution that’s been identified but there is a lot of activity that we need to take positive thoughts about. One is that we’re finding that utilities around the country and around the world are setting up groups −these are electric and gas utilities− to look at the community design with respect to how to utilize and deploy these utilities in the communities of the future.

We’re beginning to see the evolution of systematic planning tools that are actually being used in decision-making today for infrastructure that takes into account not only demographics but what the automobile companies are beginning to see as their markets and the location of their markets as well.

The third would be the renewable energy again where we have a consideration by many agencies in the country of how will you design a community of the future to enable a high penetration of renewable energy. These are called RESCO renewable energy-based communities. Transportation is currently an integral part of that. That is also, I think, a positive sign going forward.

Finally, let me just say that the discussion and implementation today of hydrogen fuel infrastructure is causing decision-makers to work with universities, to work with OEMs, but also to work with community planners. That’s where the stations are going. Community planners are starting to say, “My goodness, what is this?” Just one short snippet: they’re excited to find out that only 15% of the existing gasoline stations need to be modified to support an entire population of hydrogen fuel cells. Why is that so interesting to them? Because it reduces the number of curb cuts along a given block. That allows a freer flow of transportation. So it’s a fun era. It’s evolving and I think we should be encouraged by that.

Gordon Feller: Thank you all very much. Thanks, Bill. Thank you to our panel.